PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

NEW Report: Regulation Crowdfunding Turns Four – Impressive Growth, Year of the Crowd is Upon Us

By at 21 May, 2020, 8:42 am

By Sherwood Neiss-

A new report released today by Crowdfund Capital Advisors summarizes 4 years of data since Regulation Crowdfunding (Reg CF) started.  Key findings include:

● Almost 1,500 companies in 49 states plus Washington, D.C. and Puerto Rico have raised over $367 million online.

● Average success rate for companies seeking money online was 60%; much higher than the average success rate for Venture Capital (~2%)

● During this past year almost $700 was invested every minute into startups and small businesses.

● Over half a million Americans have shown their interest in funding businesses they believe in by investing on average $716 per offering.

● 80% of the investors are retail and 20% are accredited, however 80% of the capital invested comes from the accredited investors.

● In the very first year of Reg CF there were only 61,000 investors that deployed $56 million.

● This past year those figures jumped to 265,000 and $138 million respectively.

● No fraud according to a SEC report.

● Companies that were successful with a Reg CF offering saw year over year revenues increase on average 23%.

With the proposed SEC changes to Reg CF that include increasing the maximum raise from $1 million to $5 million, the industry is poised to take off. We estimate that in the next year over 400,000 Americans will invest more than $250 million into startups and small businesses all across the United States.

You can purchase the full report from Crowdfund Capital Advisors here ($4.95).

Sherwood Neiss is a principal at Crowdfund Capital Advisors, a member of SBE Council, a 3-time Inc. 500 winner, and co-authored the Crowdfunding Framework used in the JOBS Act that was signed into law by President Obama on April 5, 2012.

 

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